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CERNOBBIO, Italy—Apple Inc.'s aggressive response to a €13 billion ($14.5 billion) tax ruling by the European Commission shows the U.S. technology company doesn't understand the moral obligation on big companies to pay taxes, according to the leader of the eurozone's finance ministers.

Jeroen Dijsselbloem said Apple had "failed to grasp" the public outcry over tax avoidance by large companies.

The comments are likely to inflame an increasingly angry trans-Atlantic dispute about the ruling, which has pitched the White House against the European Commission and seen the heavily indebted Irish government resist a €13 billion tax windfall.

"The Apple response shows that they don't grasp what's going on in society and they do not grasp what's going on in the public debate," Mr. Dijsselbloem, president of the Eurogroup of finance ministers, said on the sidelines of the Ambrosetti forum of business leaders in Italy. "This is a very strong moral issue and large companies, even if they're this large, can't say 'this is not about us, there's no problem here.'"

"American companies or any company that uses all these different tax plans and at the end of the day pays no tax, that's not fair."

The European Commission ruled last week that Ireland breached competition law by allowing Apple to pay a tax rate in the country—where Apple books the bulk of its European profits—that it said reached 0.005% in 2014. Apple was told to repay the money to Ireland.

Apple has hit back hard at the ruling, with Chief Executive Tim Cook warning in a public letter that it threatens to "upend the international tax system." He also denied the commission's factual claims. He later told Irish broadcaster RTE that it was reasonable to discuss both the level of tax and which countries it was paid to, but "that conversation should be about future taxes, not retroactive taxes. The EU Commission's overreach in this regard, is unbelievable to us."

Both Ireland and Apple plan to appeal the commission's ruling. Apple declined to comment further on Sunday.

John Bruton, who was Irish prime minister for part of the period covered by the tax ruling, warned that it endangered the country's ability to provide a stable tax regime for companies. "What's really threatening is the idea of retrospective tax liabilities on the basis of reinterpretation of tax rulings by people who don't have a direct competence," he said.

The White House has also raised concerns that the European ruling will undermine tax cooperation. But Mr. Dijsselbloem said there was no need for a transatlantic "tax war," and called for the strengthening of international standards.

European Commission President Jean-Claude Juncker used a press conference at the meeting of the Group of 20 large economies in Hangzhou, China, to deny accusations that the ruling was a political decision, or aimed at the U.S. "It would be totally absurd to choose the area of taxation to attack the U.S.," he said. "We are basing our decisions on facts and the legislation that applies here." He pointed out that 35 European companies had also been found in breach of state-aid rules so far this year.

U.S. presidential candidates Donald Trump and Hillary Clinton have said they aim to reform U.S. taxes on offshore profits to secure a chunk of the $1.7 trillion in cash estimated by Moody's Investors Services to be hoarded offshore by American companies. U.S. corporate taxes are applied only when overseas profits are repatriated.

Australian Prime Minister Malcolm Turnbull said addressing corporate tax avoidance is an issue related to resisting protectionism and isolation taking hold in many nations. "Paying taxes is not optional. Businesses must pay tax," Mr. Turnbull told a panel on the G-20 sidelines. It is important for governments to be able to show that "the people who are making money and doing well are paying their tax," he said.

Mr. Dijsselbloem is in conflict with the commission over its ruling in October last year that the Netherlands, where he is finance minister, offered a sweetheart deal to coffee chain Starbucks Corp. that amounted to an illegal subsidy. But he said the case was different, and the Netherlands didn't dispute the commission's right to ensure fair competition.

Ireland and the Netherlands were at the centre of tax-avoidance strategies known as the "double Irish" and "Dutch sandwich" used by multinationals, especially U.S. tech companies.

Valentina Pop and James T. Areddy in Hangzhou, China, contributed to this article.

Write to James Mackintosh at James.Mackintosh@wsj.com

(END) Dow Jones Newswires

September 04, 2016 22:15 ET (02:15 GMT)

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